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WTO NEWS: 1995-99 SPEECHES - RENATO RUGGIERO, FORMER DG

Christchurch, 15 July 1996
APEC trade ministers

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Christchurch, New Zealand

Your Excellencies, Ladies and Gentlemen,

APEC has established a high level of ambition for regional trade liberalization. I hope that you can also transmit a high level of ambition to the first Ministerial meeting of the WTO in Singapore this December.

Singapore will not be an easy meeting. It is the first political rendez-vous of a new institution, the first milestone on the ambitious path which was charted by the Marrakesh Agreement. In Singapore we can expect at least 3,000 people, representing 120 member governments, 30 accession candidates, other international organizations, NGOs representing environment, consumer, and development groups - 60 environmental groups alone - as well as trade unions, business and of course the media from all over the world.

Their presence will testify to the political importance that is attached everywhere to the implications, the hopes, the anxieties that go with trade, globalization and interdependence. In all of our countries, people are concerned with their prospects for growth and their prospects for jobs. Issues like structural adjustment in both developed and developing countries, the marginalization of the least-developed countries, the relationship between regional and multilateral liberalization, and the universality of the trading system - these challenges are not ones for some far-off future which we can contemplate in a detached or academic way. They are already with us - they will be on the table at Singapore whether we put them there or not - and they call for a response.

You, the Ministers, have to give answers to those hopes and those anxieties just as I hope you will give clear instructions to your representatives in Geneva to move on to reach the maximum possible level of consensus on all the most important issues that still divide us.

It is still hard to say how far we are from reaching this consensus, but I have to call your attention to the fact that time is limited, and that we are not seeing sufficient movement towards agreement. The problem we face is not one of procedure, but one of substance.

There is no justifiable reason not to agree before Singapore on a work programme, the more so since much of it is already in the built-in agenda.

I know that I am talking to Ministers from regions where the benefits of the open multilateral trading system have been most significant. Your APEC agenda already covers almost everything that has been proposed for Singapore. It would be difficult to explain that what is possible in APEC is not possible in the WTO.

Practically everyone sees implementation as a key element of the Singapore conference, and of course it is, but we should remember that in the context of the Uruguay Round results implementation has a very dynamic meaning. It certainly does not mean standing still and looking back at where we came from. The world is moving ahead, with us or without us. Your economies are doing the same. If we do not keep the trading system moving forward too, we risk leaving the unstoppable movement towards regional and global integration without adequate rules and without a clear vision. The difference is a fundamental one.

In the light of the discussions we have had so far in Geneva, I can envisage a draft Ministerial Declaration for Singapore which would cover the following main elements:

  • Implementation of the Uruguay Round results;
  • The WTO's work programme;
  • And the broader political concerns that the WTO must take into account.

I would like to briefly outline the situation concerning each of these points as I see it.

  • Implementation is a mixed picture, though I see it overall as more positive than not. The key aspect, and the main success, is dispute settlement. I believe that the dispute settlement mechanism is playing the central role that was intended. It is being used by both developing and industrial countries, large and small. There have so far been 50 requests to start consultations. Six cases are currently before panels, and two panels have been completed. We have recently seen the first ruling of the Appellate Body. But just as importantly, a significant number of disputes - ten so far - are being resolved at the consultation stage without resort to a panel. This testifies to the credibility of the system and to its deterrent effect.

    Elsewhere there is more room for improvement, especially concerning notifications. Other delegations have expressed strong concerns about the outlook for implementation of the textiles agreement. These concerns deserve serious attention.

    I would like to recall also that we should report at Singapore on the implementation of the Marrakesh Declaration on Least-Developed Countries - concrete progress in this regard is the minimum that we should be able to do to aid integration of the poorest countries into the world economy and its benefits. I will have more to say on this later.

    Implementation also includes the work of the Committee on Trade and Environment. The Committee has done useful work in bringing together environmental and trade interests and beginning to define the basis for a mutually supportive relationship, and concrete results of solid value are within reach; what is needed is the political will to take hold of them. I see worrying signs that this will is not sufficiently present.

  • The consultations in Geneva so far have shown that the scope of the WTO's work programme is the most difficult question for Singapore. The current situation is that we have a range of proposals on subjects which either have a foot-hold in the built-in agenda, seek to add to it, or cut across categories. Twenty-four "non-papers" have been tabled, on 14 subjects, of which the great majority are already within the scope of existing WTO bodies to a greater or lesser extent; only a very few could really be called new. The urgent challenge is to distil these disparate elements into a substantial but balanced work programme.

    The built-in agenda involves, among other commitments, the start of new negotiations in major sectors, such as services and agriculture, at the turn of the century. The necessity of preparing adequately for these negotiations has been emphasized. We sometimes hear the complaint that multilateral negotiations move too slowly. However, one of the reasons the Uruguay Round took so long was that, in many sectors, preparation did not begin until after the negotiations were launched. Since governments have already agreed on the timing of these new negotiations, it is surely logical to begin the necessary preparatory study and analysis well in advance - this is important, not least, to ensure that all the members of the WTO, whatever their level of development, are able to participate fully.

    Furthermore, though the work programme must start from the built-in agenda, a number of delegations have made the point that it cannot be confined to it. For one thing, they have noted that the built-in agenda has some very obvious gaps, such as industrial tariffs. The hope has also been expressed that the Singapore conference might give a further liberalizing impulse in a number of sectors where the Uruguay Round negotiations fell short of success.

  • The political perspectives: At Singapore, Ministers will be expected to give a sense of the aims and objectives of the trading system - the global challenges and opportunities within which our work programme will operate, and to which it must ultimately respond.
  • Globalization - it should be made clear that this means maximizing opportunities for growth, jobs and reducing marginalization. The unity of industrial and developing countries around the benefits of the open trading system and global integration is the great achievement of the Uruguay Round - it is one we must consolidate and build on. There is no rational alternative.
  • We must also extend the benefits of global integration to the least-developed countries - implementation of the Marrakesh Declaration is the immediate priority, but the ultimate goal must surely be elimination of all barriers to their market access possibilities. The promotion of investment in the least-developed countries is another important aspect, one which argues for the negotiation at the appropriate time of fully multilateral investment rules in the WTO. There is also a clear need for building human and institutional capacity through improved technical assistance in cooperation with other agencies (which also helps implement the Uruguay Round Coherence mandate).
  • The trading system must be universal. We need to bring the 30 candidates in as soon as possible, but in a way which strengthens the system.
  • The relationship between regional and multilateral trade liberalization - APEC has a key responsibility here. I cannot emphasize enough the importance of a positive interpretation of open liberalization - that is, respecting the MFN principle - as a basis for convergence of regional and multilateral initiatives. Without such a convergence, we risk fragmentation of the global economy into two, three or four preferential regional blocs, each one with its own rules and procedures, confronting each other at the border. This is not the way in which trade can best contribute to building a more integrated, more balanced, and ultimately a more secure world.
  • Lastly, let me underline the importance of sending the world a message of reassurance and confidence about the multilateral system, a rule-based system, rather than one based on power. This is something a successful Singapore meeting can and must do. As part of doing so, I hope it will establish the basis for using the 50th anniversary of the multilateral trading system to reaffirm its importance and reassert its dynamism.

To conclude, let me sum up by saying that you have a choice: you can go to Singapore with important issues still open and spend a week haggling about texts under the pressure not only of time but of the world's attention. To achieve consensus in such circumstances would be much more difficult.

Or on the other hand you can go to Singapore having already agreed on the outstanding issues and thus be free to have a creative interchange on the key political and institutional challenges in the trading system. This requires directing your representatives in Geneva clearly to reach such an agreement and giving them the necessary flexibility to do so.

Doing so will make it possible for you, the Ministers, to concentrate on the task that only you can really do - renewing the sense of purpose and direction of the multilateral system and making your commitment to it clear to the world.